CALGARY, ALBERTA — (Marketwire) — 12/20/12 — Cortex Business Solutions Inc. (“Cortex” or the “Company”) (TSX VENTURE: CBX) is pleased to announce the Company-s FY 2013 Q1 Financial and Operational Highlights. Complete financials and MD&A are available on Sedar ().
Revenue was $1.4M in the first quarter of the fiscal year of 2013 (“Q1 F2013”), compared to $1.2M in the same quarter fiscal year 2012 (“Q1 F2012”), reflecting an 18% growth in total revenue. Included in the total revenue is access and usage fee revenue of $1.2M Q1 F2013 compared to $885K in Q1 F2012 representing a 40% increase in recurring revenue growth quarter over quarter.
At the end of the Q1 F2013, Cortex had signed agreements with 56 buying organizations (“Hubs”), 14 more than at the end of fiscal 2012. Of those, 34 have progressed through the pilot phase and were available to receive invoices from their suppliers electronically. Hubs are the main driving force for growth in the Company as each new Hub brings a list of additional customers to the Network and provides additional destinations for existing Network users to send invoices to. During the Q1 F2013, Cortex added 507 new customers, an increase of 6% over July 31, 2012 and increased transactions through the system by 342,997, an increase of 16% over Q4 F2012.
Cortex had a net loss of $1,840,714 in Q1 F2013, or $0.01 per basic and diluted share, compared to net loss of $2,065,191 in Q1 F2012, or $0.01 per basic and diluted share. This improvement in net loss is the result of increased revenue in conjunction with a 9% reduction of expenditures compared to Q4 2012.
“Cortex continues to grow our Network of companies, transactions and revenue during a time period when drilling activity in the oil and gas industry is down considerably from last year. This is a direct result of our investments in market expansion, productivity improvements and technology over the past year”, said Art Smith President & CEO of Cortex. “We expect 2013 to be a significant year for the Company in terms of both revenue growth and productivity improvements, as we expand our Network in Canada and the United States.”
Outlook
Cortex will continue to expand the Network by adding Hubs and their supplier groups through current and new partnerships. Cortex will explore new revenue, industry and partnership opportunities in Canada and the U.S.
Building on the strong Network growth in 2012, Cortex began fiscal 2013 with 42 buying organizations signed to the Network, 21 Hubs active on the Network and 7,933 contracted suppliers. By the end of Q1 fiscal 2013 there were 56 buying organizations and 34 Hubs active on the Network with 8,440 contracted suppliers. This is an encouraging start to F2013 with continued strong relationships with clients and partners which are expected to provide continued month over month revenue growth through increasing transaction volumes between our 56 Hub customers and their suppliers.
Organic network growth, both in the number of customers connected and the number of transactions they do, has provided a solid revenue foundation for the Company. Management expects to see continued Hub signings in 2013 projecting to exit fiscal year ended July 31, 2013 with over 100 Hub customers.
Strategic partnerships with Full Circle, Powervision, Pandell, Basware, and Verian Technologies are providing numerous opportunities to add buying organizations in both Canada and the U.S.
In the coming year, management expects to complete more partnerships, launch new features to the Network and continue increasing recurring revenue building on the Q1 F2013 10% recurring access and usage fee revenue growth over Q4 F2012.
The Company has issued 2,263,456 common shares as approved by the TSX Venture Exchange and 2,463,400 stock options in alignment with the Company-s Employee Performance Management (“EPM”) Program. Of these issuances, 366,500 common shares and 1,400,000 stock options were issued to insiders.
Annual Results Conference Call
On December 20, 2012 at 2pm MST, please join the live conference:
Toll-Free Dial-In Number: (877) 440-9795
Local Dial-In #: (416) 340-9432 (Toronto)
Time: 2:00 PM MST
A replay of the conference call will be available two hours after the call-s completion and will expire by 11:59 pm EST on December 27, 2012. You may listen to the recording by calling (905) 694-9451 or toll-free at 1-800-408-3053. The password for the replay is 165 14 19.
About Cortex Business Solutions
Cortex Business Solutions Inc. is a leading eCommerce service company that improves efficiencies, reduces costs and streamlines procurement and supply chain processes for its customers. Accessing the Cortex Network enhances the exchange of business critical documents, such as purchase orders, receipts and invoices resulting in improved cash flow management and business controls, while reducing day-s outstanding and administrative costs. Cortex is a low cost, low risk solution that can be implemented quickly by leveraging its customers existing business environment – evolving business.
Forward-Looking Statements
Statements in this release that are forward-looking statements are subject to various risks and uncertainties concerning the specific factors disclosed under the heading “Risk Factors” and elsewhere in the Company-s periodic filings with Canadian securities regulators. Such information contained herein represents management-s best judgment as of the date hereof based on information currently available. The Company does not assume the obligation to update any forward-looking statement.
The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of the content of this news release.
Contacts:
Brisco Capital Partners
Scott Koyich
(403) 215-5979
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